13 May Do consumers know the harm of purchasing counterfeits and contributing to a rise of a seemingly innocent black market?
The internet age has allowed the counterfeit market to expand dramatically, allowing overseas merchants to sell fake goods online bypassing counterfeiting laws. The 1.2 trillion dollar industry is one of the globe’s biggest, yet is still entirely illegal and black market. Beyond the retail-consumer market, retailers from countries with looser replication laws are selling to British street markets in touristic areas – leaving the public funding the world’s largest criminal networks.
The UK is the world’s 5thlargest importer of global goods. Yet it comes as a surprise to many that 7% of products imported to the UK are counterfeit. During the 80’s and 90’s hip hop music videos starred artists in head to toe designer names. This form of marketing lead to a nation of people desiring to be wearing the designer goods but not willing or able to pay the high-end price. In the prime of replica designer wear – watches, handbags and belts, the place to shop was local markets. As the online shopping market explodes the ease of door to door delivery creates a consumer base blind to the harm behind where the money ends up.
A Recent report from The Organisation for Economic Co- Operation and Development and the European Union’s Intellectual property office have revealed that the ‘fake’ industry is now worth £384.4 billion a year in the UK. It is believed to have been driven by the rise of counterfeit goods being sold online. The report found that fakes make up for 3.3% of all international trade in 2016 compared to 2.5% in 2013. During the same period the number of trade volume declined, showing the true scale of the surge. Free trade zones such as Singapore are seeing an increase in the illegal activity so it was not seen as a surprise that China is producing the greatest number of counterfeit goods. Critical to the case in question, an increase of smaller packages was also seen, highly suggesting the increase of individual door to door deliveries rather than the bulk deliveries for people to then distribute the fake goods. This may suggest why markets have been rising and street vendors have had to start to compete with online prices and availability.
Rohan Golkar has been selling counterfeit goods on his Camden market stall for over 15 years. His stock includes YSL counterfeit bags to fake branded e-cigarettes; the latest designer goods for as low as £15 for a Gucci belt. Rohan explained, ‘We buy in bulk online and stock moves fast. But more people are just buying online themselves now. We have to compete by making sure we have the latest trending labels in stock’. When questioning Rohan on his knowledge of who is making his stock he did not show much concern ‘I know they reckon it all comes from factories where kids are working, but how am I ever meant to know’. He disagreed with the idea of counterfeit sales funding gangs ‘people reckon it all goes to funding gangs as well but I’m just an average bloke trying to make a living, I ain’t in no gang’. Rohan wasn’t concerned with the risks and ethical problems of buying his stock online or where and how it was made he admitted this by saying ‘I’m just trying to make a living at the end of the day whether it’s illegal or whether kids are making the stuff in factories, I’m making money and paying taxes’.
Online ‘buy and sell’ groups and social media marketplaces have millions of counterfeit listings. Analytics firm, Ghost data, revealed there has been more than two million posts of counterfeit items using the hashtag ‘replica’. Since 2016 there has been an increase of 171% of accounts selling counterfeit items, now at 56,759 accounts. They also unearthed over 15% of the posts using illegal brand name hashtags. Facebook selling pages post their stock on their page and ask you to ‘DM to order’. Sites post ‘would just like to say if anyone has any specific products they are looking for could you please DM us and we may be able to source them for you’. On the contrary of individual online sellers, Alibaba, a Chinese bulk retailer, happens to be the largest online trader on the planet, and the 8thlargest company globally. However it is also the largest distributor of counterfeit products entering the Western market. In January 2018 the U.S Trade representative put Alibaba’s sister brand, TaoBao, on a blacklist for the second year in a row following counterfeit distribution investigations.
Rory Burtenshaw aged 20 regularly buys counterfeit goods online or through friends. His most recent purchase was Ralph Lauren tracksuit that he purchased for £20. He finds the fakes on Facebook marketplace and Depop. When asking him the main reason he purchases counterfeit goods he simply responded ‘they are cheaper than usual’. When going onto discuss the legalities and ethical problems of buying fakes. Rory told me ‘I never really think about it at all to be honest, it doesn’t ever really cross my mind, but the police won’t arrest me for buying a fake tracksuit’. The rhetoric seems to be that nobody really envisions the harm their money could really be funding. But when the consumers themselves sees the negatives firsthand, it can put into perspective the scale of the issue.
With Citizens Advice receiving over 13,000 problems when buying from online market places it does not come as a surprise that not everyone intentionally buys a counterfeit item. Linda Taylor, aged 45 was swindled of £150 after thinking she was getting a real Burberry handbag for a bargain. After contacting someone on Facebook’s market place she sent over the money using a direct bank transfer and was told she would receive the bag within 3 to 5 working days. When she received the bag, she was horrified to find it was nothing like the images and was a fake. When asking her if she had ever considered she might be getting ripped off online she disagreed ‘no it never came to me. The ladies page had several five star reviews. Looking back now I should have realised everything on her page is fake’. When approaching Facebook they apologised and explained that there was no way she could get her money back.
The majority of people buying fake goods are not aware of the consequences. When buying counterfeits such as electrical devices not only could they be poor quality but they can also be harmful to you. Fake perfume can cause severe allergic reactions and in some cases even burn your skin. Police recently issued a warning after they seized fakes worth over £40,000 during a raid in a perfume factory. The perfume had been found to contain urine and cyanide. The sales of counterfeit goods have also been connected to crimes such a human trafficking and organised crime groups. Criminals rely on the sales of fakes in order to fund criminal activity. Counterfeit officer Alastiar Gray revealed in his ted talk real life examples of how the sales of fake goods are a huge criminal operation involving international gangs and money laundering. A recent raid of 5 warehouses in turkey linked back to 3 million euros worth of money being launder through Spain in under two years. In just two days after the raid the gangs were illegally trying to bribe a law firm in a bid to get their stock back. Buying a 10-pound pair of fake sunglasses could be funding your cities biggest drug lord bringing anti-social behaviour to your local area.
Many different bodies are introducing initiatives to try and keep consumers safe online. In 2018, Hashtag “shocking fakes” was set up by The City of London Police’s Intellectual Property Crime Unit in an attempt to reduce the number of counterfeit electrical products being sold due to a major risk to public health and safety. A survey of 1,807 people held by Electrical Safety First found that 30% of the consumers had been defrauded into thinking a counterfeit electrical good was genuine. This all started after an unbranded mobile phone charger caused a fire in a flat in North West London. The City of London police encourages people to use the hashtag ‘#shockingfakes’ in order to spread the word to make others more aware.
Amazon’s ‘Project Zero’ initiative is a tool that removes potentially counterfeit products from the site. This lead to more than three billion listings being taken down from the site last year alone. Amazon also claim to protect consumers and allows for refunds if unhappy. The government have similarly backed an initiative this year known as ‘The Real Deal online Programme’ it has been set up by the National Markets Group for IP Protection in order to help administrates run fake free marketplace groups. Groups that follow the ‘Real Deal Online Code of practice’ will display the logo giving reassurance to consumers.
‘Which?’ suggest that consumers report counterfeits to their local trading standards office and advice can be received from Citizens Advice. Alternatively, the police department, action fraud have tips on how to protect yourself when buying online. You can protect yourself by being cautious when purchasing something that may seem too good to be true. Check the site you are purchasing goods room; does it have a padlock in front of the URL. When receiving the item check the quality, labels and spellings. Both consumers and sellers are uneducated on the impact that counterfeits really do have. Counterfeiting is only going to get bigger consumers need to be educated when spotting a fake and aware of the impact.
